A national audit of cafes, restaurants, fast food and retail businesses that had previously breached workplace laws found 71 per cent were still disobeying rules on pay and conditions.
In a year-long audit ending in March the Fair Work Ombudsman, the national wages watchdog, checked 177 food and retail businesses previously caught breaching workplace laws and found 122 were still doing so.
Many food and retail businesses were still underpaying their staff after already being caught by the Ombudsman.Credit:Shutterstock
The figures underscore the challenge for the Morrison government's industry-union working groups, which are trying to negotiate reforms to fix the problem of persistent underpayment.
The ombudsman recovered $709,289 from 84 businesses for 796 employees who had been underpaid, with most of the issues relating to penalty rates and the minimum hourly wage. None of the businesses were taken to court, though 16 were fined a combined $31,000.
A separate audit from the ombudsman, also released on Thursday, showed 84 per cent of businesses in Melbourne's famed Hardware Lane and Degraves Street precinct had underpaid workers almost $200,000.
Unions and business groups are at odds over the cause of underpayments, with unions arguing many employers deliberately fail to pay proper wages and punishments are too lenient to force businesses to check their adherence to pay rules. However, businesses say Australia's workplace rules are too complex to interpret and apply.
Among the audited businesses, 64 per cent of those in Melbourne and half in the national group said they had breached work laws because they were not fully aware of their obligations.
Degraves Street has been deserted during Melbourne’s stage four lockdown and the Ombudsman said she would factor in COVID-19 hardship when it comes to prosecuting.Credit:Scott McNaughton
Ombudsman Sandra Parker's report cited the price pressure on businesses in tourist strips like Degraves to keep prices low.
"Open long hours and seven days a week, businesses may be required to pay penalty rates and overtime," the report reads. "However, as profit margins narrow, employee wages are often impacted in the drive to reduce costs."
Ms Parker also noted the ombudsman takes legal action against the most serious cases of underpayment, suggesting she did not regard those in the national audit as being of the grave and deliberate kind.
Ms Parker said she would protect young workers, students and migrants but would factor in the hardship businesses are experiencing because of COVID-19.
The Melbourne audit found one business in the laneways owed its workers $59,680 while another was only out by $30. In total 186 staff were underpaid and the Ombudsman has started litigation against one of the businesses.
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